Canada. Commission of Inquiry on Unemployment Insurance : The Commission of Inquiry on Unemployment Insurance was established under Order in Council P.C. 2162, 4 July 1985, under Part I of the Inquiries Act (R.S.C., 1970, c.I.13) and on the recommendation of the Minister of Employment and Immigration, as amended by Orders in Council P.C. 730, 26 March and P.C. 2256, 30 September 1986. The Commission was mandated to inquire into and report upon the role of the Unemployment Insurance Program within the context of the Canadian social security system, as a means of improving the operation of labour markets in Canada, supporting more effectively Canada's economic development, ensuring the equitable financing of the Program and providing new and better opportunities for Canadians experiencing temporary unemployment by: (a) examining, in relation to the program, the appropriateness and adequacy of: (i) the coverage and conditions of insurability, entitlement, and eligibility, (ii) the benefit structure, (iii) the funding by employers, employees and the Government of Canada of the various components of the program, (iv) the respective proportions of the cost of the program that are borne by employers, employees and Government of Canada, (v) the developmental uses of the Unemployment Insurance Account for the purposes set out in sections 37, 38 and 39 of the Unemployment Insurance Act, 1971, and (vi) any other aspects of the program that may be raised during the course of the inquiry; and (b) to inquire into and report upon the: (i) means to respond to deficiencies in the program, (ii) ways in which the program may be used to further re-entry into and adjustment to the labour market of claimants, (iii) changes to requirements to be met by claimants in order to receive benefit, and (iv) administrative measures to be taken to maintain or improve the integrity of the program.
The Commissioners were to give particular attention to: (i) the views of employers and employees referred to in paragraph (a) and of associations representing those employers and employees, on the matters referred to in paragraph (a) and (b), and (ii) any recommendations and findings of the Royal Commission on the Economic Union and Development Prospects for Canada that related to the Unemployment Insurance Program. The commissioners were Claude E. Forget, Chairman; Roy F. Bennett, John J. Munro, Frances J. Soboda, Moses O. Morgan and Guylaine Saucier. The secretary was Elizabeth Dowdeswell. In September 1986, she was replaced by Nola K. Seymour.
In the early 1980s, the rate of unemployment in Canada was high. In 1984, for example, the rate averaged 11.3 percent, and almost 10 billion dollars was paid out in unemployment insurance benefits. This amount was considerably in excess of contributions to the unemployment insurance fund. The shortfall had to be paid out of general revenues of the Government of Canada and that increased the deficit.
Critics believed that the insurance principle basic to the soundness of the Unemployment Insurance Act (19-20, Eliz. II, c.48, 1970-1971) had been ignored. According to a journalist for Southam News:
"Over time and with changes in objectives, however, coverage was extended and unemployment insurance funds were not just for unemployment, but for programs covering job training, job creation, illness, maternity, work sharing, fishermen, adoption and retirees."
Critics also charged that the unemployment insurance system encouraged the unemployed to take temporary employment and just work the minimum time required to qualify for benefits. Further, it induced the chronically unemployed to remain in areas of high unemployment. Moreover, the system was considered to be unfair because casual workers often in similar circumstances, received greater unemployment insurance benefits if they lived in an area of high unemployment. As for job-creation programs, they usually did not contribute to long term economic development or steady employment.
In spite of its shortcomings, it was just too dangerous politically for the government to make radical changes in the unemployment program. If benefits were reduced, for example, the burden for the unemployed would, undoubtedly, fall on provincial and municipal governments. Furthermore, a cut-back could seriously disrupt the economy of high unemployment areas, not to mention the income security of the jobless. Ideally, the government could correct some of the unfairness of the system, clear up some of the more obvious abuses, and remove some of the disincentives to work without adverse political consequences.
In an economic statement to Parliament, of 8 November 1984, Finance Minister Michael Wilson announced that the Government of Canada would conduct a study of the unemployment insurance program, which would be followed by a parliamentary review. Further, in the budget speech on 23 May 1985, Wilson again stated that the government intended to have a major study undertaken on the subject of unemployment insurance. According to Wilson, the purpose of a study would be as follows:
"Our objective is to improve and simplify the unemployment insurance system to make it fairer and to ensure that it provides flexible adjustment in the labour market. I want to emphasize that we are not undertaking this review with an objective of reducing federal contributions to the unemployed."
Consequently, the government decided to hold a public inquiry into the unemployment insurance system and on 4 July 1985, the Minister of Employment and Immigration, Flora MacDonald, announced its appointment. Claude Forget, who chaired the inquiry, saw the mandate of the commission as follows:
"Its task was to examine how Unemployment Insurance can help Canada's economy to develop and its labour market to operate smoothly; how to make the program fair for everyone; and how to ensure that it offers the best possible help to Canadians who are temporarily unemployed. It was asked to review all elements of the Unemployment Insurance program - the extent of coverage, the criteria for eligibility, the amount and duration of benefits, as well as financing and administration."
Beyond that, the Commissioners were asked to pay particular attention to "any recommendations of the Royal Commission on Economic Union and Development Prospects for Canada [the Macdonald Commission] that relate to the Unemployment Insurance Program." Consequently, the so-called "Forget Commission" recommended the establishment of an income supplement program similar to one which had been proposed by the Macdonald Commission (see Summary Report of the Commission of Inquiry on Unemployment Insurance, Ottawa, Supply and Services Canada, 1986, p. 5; newspaper clippings, RG 33/139, Vols. 58-59; The Ottawa Citizen, 18 January 1986; House of Commons, Debates, 8 November 1984, pp. 102-103 and 23 May 1985, p. 5015).
Coincidentally, the Province of Newfoundland also held a public inquiry on the subject of unemployment under the chairmanship of John Douglas House (see Building on our Strengths: Report of the Royal Commission on Employment and Unemployment, St. John's, 1986, 515 p.).
Hearings of the "Forget Commission" were held in all provincial capitals, and in Moncton, Bathurst, Newcastle, Glace Bay, Montreal, London, Windsor, Thunder Bay, Sudbury, Hamilton, Ottawa, Calgary, Vancouver, Yellowknife and Whitehorse, from 28 October 1985 to 15 February 1986.
In addition, a number of informal community meetings, field trips, round-table discussions and consultations took place. The commission filed 1497 submissions, including several letters. RG33-139 General Inventory
